Does legal AI violate attorney client Privilege? What Heppner means for legal teams

Does using AI in the course of legal practice violate attorney-client privilege? Lawyers, already rightly concerned about the impact of AI on the profession, are worried that the data used to power AI undermines the protection given to confidential documents. And, in the first court case involving AI and ACP,  Judge Jed S. Rakoff of the U.S. District Court for the Southern District of New York issued a decision in United States v. Heppner, creating the first AI precedent in American law. 

Judge Rakoff held that defendant Bradley Heppner’s AI queries and responses with a publicly available AI tool were not protected by the attorney-client privilege or work product doctrine. Now, lawyers everywhere are wondering whether using legal AI tools violates ACP as well. 

The defendant in the case used this AI tool — on his own, without any direction from his attorneys — to generate documents outlining his defense strategy. He fed information and documents he had received from his lawyers which was protected by ACP. The court found that those documents lost their protection under ACP because: 

1. There was no attorney-client relationship with the AI tool, 
2. The platform's terms of service permitted data collection and disclosure to third parties, including the government, 
3. The defendant acted without attorney direction.

The decision in Heppner turned on a very specific set of circumstances that do not apply to most specialized legal AI tools. These tools, like Ivo, are secure enterprise platforms used by attorneys, whether in-house or outside counsel, to manage and review contracts. When individual contracts are uploaded for AI-assisted review, this does not waive ACP. Customer data is never used to train models, and nothing leaves the platform. In addition, routine, secure contract storage by attorneys does not waive privilege, nor does analyzing contracts with AI. AI is merely the mechanism that organizes and surfaces documents. The attorney is the one using the platform, access is controlled, and nothing is disclosed to any outside party, which is what actually triggers waiver of ACP. This is the opposite of what happened in Heppner.

This is the key question for whether attorney-client privilege has been waived: Is privileged information being voluntarily shared with an unauthorized third party outside of the attorney-client relationship? With a tool like Ivo, the answer is no.

The lesson that Heppner offers for in-house legal teams is to make sure that team members are not using free, publicly available AI tools for confidential legal work, and to ask their AI providers on how their data is being stored and used. More education for legal teams on how their AI solutions work will go a long way to assuage fears about how important legal protections are being preserved.